|The best ways to invest in Saudi Arabia (to double your money easily)|
Investing in Saudi Arabia has become easier recently due to the facilities provided by the country’s government in this field. For example, the Ministry of Investment in Saudi Arabia provides a set of facilities and solutions to investors, such as addressing operating problems and providing legal advice…
In this article, we explain to you all the information you need to know about investing in Saudi Arabia, and we will share with you a group of the most important and best ways to invest in Saudi Arabia that generate abundant profits.
First: What do you need to start investing in Saudi Arabia?
1. Determine the duration of your investment
Investing in long-term projects is different from its counterpart in short-term projects. Accordingly, you need to determine the period of time during which you expect to achieve profits, as this will help you to determine other important factors such as the field of your investment and the method of its implementation.
Determining the period is also related to determining your investment rate. Will you invest in a field continuously, or do you aim to invest an amount available to you only once? There are investment methods that suit each specific rate, and the profit rate varies with the periodicity of investment.
2. Gaining experience in the field of investment
Your economic expertise will help you face market fluctuations and help you seize investment opportunities. Investment experts have a high ability to manage the risks and crises that may affect their investments and get out of them with the least possible losses.
However, having investment experience in Saudi Arabia or any other country is not necessary to enter this field. Lack of experience should be an indicator for you to invest in areas with less risk and a lower rate of risk.
For example, investing in stocks is excellent, but its management must be done with a certain level of study. On the other hand, investing in gold is considered one of the safest investments at the present time, because its rates of decline are not equal to those in stocks.
In the simplest sense, your investment experience directs you to the best investment method that suits you.
Finally, experience in the field of investment can be gained through two basic methods:
Theoretical experience of extensive access to economic news, whether in general or specific to a specific investment method.
Practical experience gained through actual investment.
We recommend acquiring extensive theoretical experience before actually investing in any investment method in Saudi Arabia. As for actual experience, it is closely related to the investment method itself.
Gaining experience in investing in a particular investment method differs from practicing this method mainly for the purpose of investing. The first must be done with simple amounts and a stable rate for the purpose of learning only, while the second aims to achieve profits or income within a certain period of time.
Finally, acquiring special experience in a particular investment method will not help much when practicing other methods, but its presence will not harm.
3. Determine your investment amount
The first step in investing is determining the amount you will allocate for it. Determining the amount of investment helps to determine the field of investment itself, and instead of exhausting yourself in studying investment in different ways, you can focus on the method that suits the amount available to you.
4. Determine your investment goal
In general, every investor has his own goals that he hopes will be achieved by the investment method he relies on.
Some invest their money by offering to preserve its value, and this is a common reason now with the high price of the dollar compared to the prices of other currencies. Some invest with the aim of providing additional income, and others aim to invest their money with the aim of increasing it and other goals.
Objectives vary, as well as the appropriate investment methods. Make a comparison between investment methods in Saudi Arabia, and determine which of them suits your current investment goal or your future goals.
5. Study the method in which you will invest and the state of its market
The previous points should have helped you decide which investment methods in Saudi Arabia suit you, and now it is time to study them. Studying the investment details in any of the investment methods in Saudi Arabia will not take long.
You will need to know the party through which you will invest, such as banks or companies, and the details of dealing with this party. Studying the market for the method on the other hand is something that may take some time and effort to fully understand its details.
Studying the market informs you of the feasibility of this method in achieving profits, the level of risk in it, and the best practices suitable for it.
You need to study the market of the medium in which you will invest over a period of six months to a year. Examine this period and note the changes that occurred on it, the rate of its profits, and the reasons for any increase or decrease in profits.
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Second: The best ways to invest in Saudi Arabia
1. Investment Banking
The banking investment in Saudi Arabia includes several investment methods that banks provide to their clients, which may include:
a) investment funds
Investment funds are investment vessels that collect the capital of some investors and manage them according to specific strategies. Investment funds have managers who manage them in a way that aims to achieve appropriate profits for investors in the first place.
The advantage of investment funds is that their risks are relatively low and their ability to generate profits for investors is subject to the skills of their managers. These funds provide investment advantages that no single investor can obtain without investing huge sums.
Funds usually contain securities and shares that are carefully managed with the aim of providing the highest possible profit rate and the lowest rate of losses and risks.
Each bank has a group of investment funds it manages and displays their growth information and details to the public.
Visit the bank you deal with and inquire about the investment funds available to it for a more comprehensive look at the performance of each of them. Do not make your decision immediately, but after reviewing the performance reports, especially those that show the performance of these funds during the current and previous year.
The reports will show you the investment funds available with the bank and the performance of each of them in terms of profits and losses. It is preferable to review the reports of investment funds in Saudi Arabia that are in more than one bank so that you can choose the right fund for you.
Mutual funds are a relatively low-risk method that is recommended for beginners in the investment field in Saudi Arabia.
A deposit is an amount of money that the investor deposits in the bank for a specific period in exchange for obtaining a return from it. The duration of the deposit is determined according to the bank’s terms and according to the agreement between him and the depositor. There are usually two types of deposits, one long-term and the other short-term.
Short-term deposits often range from one year to three years, and sometimes less in some banks. As for long-term deposits, their duration may reach ten years. In general, the duration of deposits varies from one bank to another and from one deposit to another.
Deposits contain less risk than investment funds, and their profits are guaranteed. If you want to invest an amount for a medium or long period of time, and you do not want to burden yourself with economic or investment details, then deposits are the right investment method for you.
As for information about deposits, it can be found in detail through the bank or banks that you deal with. Make a comparison between the deposits available from the same bank, and then go to compare the deposits offered by all banks in general in terms of duration and profits.
Important note: There is an important difference between deposits and funds with regard to recovering the value of any of them. Usually, you can recover the value of your investment in investment funds in specific periods (sometimes a specific day every month) after completing the management of these funds by organizing their accounts, of course.
As for the refund of deposit values, it will be after the period that was agreed upon during its creation, and you can only recover it after the expiration of this period.
2. Investing in stocks
Stocks are shares of corporate values that are offered by the latter in their own market called the stock market. Owning shares means owning a share in the ownership of the company. Shareholders have the right to sell them at any time convenient for them, but this is done according to certain controls and conditions.
As an ordinary person, you cannot invest in the stock market yourself, but rather it must be done through one of the brokerage companies in your country.
The performance of brokerage or brokerage firms in Saudi Arabia is monitored by the relevant government agencies to ensure that investment operations in them are conducted in a fair manner.
Investing in stocks is not difficult, but it requires a lot of study, and we do not recommend doing it without communicating with a financial advisor. In a previous article, we explained the steps for investing in stocks in detail, and what you need to determine before starting it … We recommend that you review this article.
Investing in stocks contains a high rate of risk compared to other means of investment, however, by investing in this field, you can achieve huge profits by arming yourself with some caution during its implementation and relying on the advice of financial experts from time to time.
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3. Investing in bonds
A bond is a security that proves the debt of its issuer (a government agency or a private company) to the owner of this security. Like stocks, bonds are one of the securities used by companies and governments to increase their financing sources... The difference here is the obligation to pay.
The issuer of the bond, whoever it is, is obligated to pay its value (in addition to a predetermined percentage of profits) to the bondholders or investors. This does not happen mainly in the case of stocks.
The risks of investing in bonds are limited, as are the profits, but they are guaranteed at the same time, like stocks. Government agencies monitor the details of bonds in Saudi Arabia on a daily basis, and present this information to the public in an understandable and easy-to-understand manner.
Finally, in addition to investing in bonds, sukuk is one of the best and safest ways to invest in Saudi Arabia.
The difference between bonds and sukuk is that the latter are securities that are compatible with Islamic law. Government agencies issue sukuk with the aim of collecting money for development projects, and the owner of the sukuk is considered a partial owner of the asset in which he invested.
As for the bonds, it is considered a paper of proof for the loans that the continuator provided to the companies and their issuers. The bond holder has the right to recover his money only with the percentage of profit, and he is not considered an owner of a part of these companies, entities or assets that used the bonds to purchase them.
If you are looking for a low-risk investment with guaranteed profits, then investing in bonds or sukuk is the perfect solution for you.
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4. Investing in gold
Investing in gold in general is one of the widely known investment methods in Saudi Arabia. Gold prices are generally rising globally, and therefore buying gold is an excellent idea for a short or medium term investment.
Also, due to the instability of the global economy at the present time, it is possible to invest in gold and make profits within a short period of time. Gold prices rise and fall every period, but for known reasons and at expected times.
This method is followed by some expert investors in the field of buying gold, despite its relatively high risk rate. Some investors buy gold when its price is low and sell it when it is high. This is done at a very fast pace and after extensive study.
Read also : What is the best time to buy gold
As for investing in gold safely, it can be applied in two basic ways:
Buying gold and keeping it without selling it (useful in the field of investment in order to preserve the value of money).
Buying gold and then selling it after a medium or long period of time.
Although the two methods are considered two different methods in their appearance, in the end they lead to the same result. Holding gold without selling it for the purpose of preserving the value of money is done for a period of time that may not be specified at the beginning, but in the end this gold will be sold.
Selling here may be an investment goal or with the aim of recovering the money that was paid to buy gold in addition to making profits.
As for buying and selling gold after a medium or long period of time, it depends on the rise that gold is currently witnessing in the world.
Here, selling is often with the aim of exploiting the rise in gold and making a profit through it, and then reinvesting again in it for a larger amount. The second method is relied upon by most investors in the field of investing in gold.
There are several ways through which you can invest in gold in Saudi Arabia, such as:
Buying gold from shops and then selling it to other shops or parties.
Buying gold from entities and companies specialized in selling gold to investors.
Buying gold and selling it to stores, to people, or to any party is and still is a matter that is universally recognized as the most popular way to invest in gold, but recently companies specialized in the field of investing in gold have begun to appear that provide better and safer investment opportunities in this field.
These companies provide certain sizes of gold bars for purchase in different and varied weights. When the investor buys gold from these companies, he has the possibility to sell it later to the same company after a period, with a profit margin according to the price of gold at the time of sale.
In general, investing in this field is easy and has few risks. It also allows you to invest in a tangible and understandable asset without entering into economic or financial complications.
To invest in gold, you need to determine the duration and amount of your investment, then see the rate of increase and decrease in gold prices during the current year.
5. Investing in real estate
Real estate is considered a long-term investment through which guaranteed profits can be achieved. While the value of money decreases and the price of gold decreases, we can assert that real estate is an asset whose price increases at a high rate every period.
This increase is present in all countries of the world, but in Saudi Arabia, its percentage is remarkably large.
There are two important factors that make the idea of investing in real estate in Saudi Arabia a profitable one:
The state's interest in reconstruction and construction in general.
The presence of a distinctive economic climate for companies.
The interest of the Government of the Kingdom of Saudi Arabia in the field of construction has contributed to a significant increase in the activity of this field. Increasing activity means building real estate at a greater rate and the subsequent existence of investment opportunities in this field, whether through construction, sale or purchase and sale.
The existence of a good economic climate that drives companies and investors to buy, trade and build real estate, and the presence of a diverse number of real estate increases investment opportunities and provides diversified cost opportunities, which encourages individuals to invest in this field with any amounts available to them.
Ways to invest in real estate include some of the following:
Building real estate on land you own and then selling it.
Contribute to building real estate and then profit from selling it.
Buying real estate land only and profit from selling it.
Buying real estate and then selling it after a while.
Buy a share of the property and then sell it.
Each of the previous methods differs from the other in its cost and profit rate. Building entire properties is the largest possible investment in this field in terms of cost and profit at the same time.
Contributing to the construction of real estate and then profiting from selling it is a process that requires some study, but its cost is less than the entire construction.
A share in real estate means a small part of the value of the property, for example if you have a house whose owner decided to sell it, a group of individuals can buy it for the purpose of investment and divide it into a certain number of shares, each share equals a part of its value.
The owner of the share is considered the owner of what is equal to it in the property, but dealing here is by value or by the percentage of the share in exchange for the total value of the property. If you own ten shares out of the total one hundred shares that represent the value of the property, then you own 10 percent of its value.
Real estate shares are very similar to stock shares, but without the element of risk and price fluctuation. There are two forms of profit from selling real estate shares, through selling a single share and trading it between individuals, or selling the entire property.
Selling the stock without waiting for the entire property to be sold is a method followed by some investors who want to end their investment in a property.
Investing in real estate depends on increasing the rate of its value, which is generally known, but its details differ from one property to another. The difference in details mainly affects the value of the property.
The price of two properties that are identical to each other may differ because one of them faces a public street or even a store. Familiarity with the details of the difference and the price can be known through research and asking the real estate sellers themselves, which is a method followed by many investors.
Some investors in the field of real estate do everything themselves in this field. They search for real estate, monitor their prices, request information about them, buy and sell, and so on. Despite the profitability of this method, it is cumbersome and requires some experience.
Fortunately, there is another option that you can rely on in investing in real estate, which is relying on real estate investment companies. These companies relieve you of the burden of searching for the right property for you and act as an intermediary between you and the seller.
If you are a beginner in the field of real estate investment in Saudi Arabia, we advise you to rely on one of the companies working in this field.
Finally, real estate investment is one of the ways to invest in Saudi Arabia, which enjoys stability and low risk.
6. Investing in establishing a private project or partnering in its establishment
Instead of relying on an entity or buying an asset, why not invest in your own project, whether in whole or in part? This way of investing in Saudi Arabia is preferred by people who are attracted to the field of entrepreneurship.
The amount that you have allocated for investment in Saudi Arabia is the decisive factor in choosing the project and the percentage of your investment in it. Also, the idea of investing through the establishment of a project is characterized by high flexibility in terms of
The amount of investment and the nature of the partnership.
You may have a project idea that you would like to create, so you invest your money in it. Perhaps you have a friend who wants to establish his own project and wants you as a partner in it... The forms of investment in this field are many and varied. Of course, the more knowledge you have in the field of the project, the better.
Saudi Arabia is rich in opportunities for establishing projects, whether small or large. All you have to do is choose a project idea that suits your budget. Check out our article that presents successful project ideas in Saudi Arabia if you are looking for a project idea to invest in.
Whatever the source of your idea or investment method and size, you must document and write down everything legally to preserve your rights and profits.
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7. Investing in financing a project
In a similar way to establishing a private project, financing projects as a profitable investment method in Saudi Arabia, you can search for a project in a field that is looking for an angel investor and play this role.
An angel investor finances projects in exchange for shares in their ownership. Most startups are looking for an angel investor to finance their projects.
Currently, investing in application development and technology in general is a popular way to invest in the Saudi economy. The projects that belong to this field receive a lot of support and facilities in accordance with the desire of the Saudi government to pay attention and revitalize this field.
Project financing requires a lot of study and review of the feasibility study for several projects and the comparison between them. Do not forget that it is considered a long-term investment and it is true that it may generate huge profits for the investors, but it still contains a high risk rate.
In this article, we tried to introduce you to the best ways to invest in Saudi Arabia. Of course, the current investment climate in the Kingdom of Saudi Arabia encourages investment in the previous fields and many other fields.
Do you have other ways to invest in Saudi Arabia? Share these methods with us in the comments.